Nearly nine Gigawatts of new capacity in 2016 bring wind generation to new heights.

In the US, a number of major milestones occurred on the electric grid in 2016, almost all of them involving wind power. Now the Energy Information Administration is confirming that's because of a big overall trend: wind power is now the largest source of renewable energy generating capacity, passing hydroelectric power in 2016. And since the two sources produce electricity at nearly the same rate, we'll soon see wind surpass hydro in terms of electricity produced.

Wind power capacity has been growing at an astonishing pace (as shown in the graph above), and 2016 was no exception. As companies rushed to take advantage of tax incentives for renewable power, the US saw 8.7 Gigawatts of new wind capacity installed in 2016. That's the most since 2012, the last time tax incentives were scheduled to expire. This has pushed the US' total wind capacity to over 81 GW, edging it past hydroelectric, which has remained relatively stable at roughly 80 GW.

Note that this is only capacity; since generators can't be run non-stop, they only generate a fraction of the electricity that their capacity suggests is possible. That fraction, called a capacity factor, has been in the area of 34 percent for US wind, lower than most traditional sources of electricity. But hydropower's capacity factor isn't that much better, typically sitting at 37-38 percent. As a result, wind won't need to grow much to consistently exceed hydro.

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In fact, that happened for part of 2016. As hydro began its normal late-summer decline, increased wind generation in the early fall made it the largest source of renewable energy in the US for several months. During that time, wind set some rather dramatic records. During one February night, wind accounted for more than half the power produced in a region that serves several states in the central plains. The Texas grid (called ERCOT) is also regularly setting new records, and wind penetration has hit 47 and 48 percent in the previous year.

These numbers came primarily during periods of low demand, but they do provide an indication that a properly managed grid can integrate significant amounts of intermittent power.

While wind will inevitably pass hydro in terms of electricity produced, 2017 is not likely to be the year that happens. To begin with, the tax benefit for new wind capacity will be lower in 2017, as it drops toward a planned elimination in 2020. While wind will still be cheaper than any generating source other than natural gas, the lowered benefits will still change the economics enough to slow installations.

But the biggest factor is likely to be high production of hydroelectric power. After several years of catastrophic drought, California has received so much rain that at least one dam has been at risk of failure. This will ensure much higher hydroelectric production through to late summer, and it will increase hydroelectric's capacity factor overall. This should be enough to keep hydro ahead despite the smaller overall capacity.

But as wind can be installed fast, more cheaply, and with far lower environmental impact, the reprieve is certain to be temporary.

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